Hormuz Vessel Traffic Drops to Single Digits 
UK Economy Grows 0.4% in July, Beating Forecasts 
Goldman Sachs Forecasts Fed Rate Hike as Inflation Risks Rise 
Global Central Banks Brace for More Rate Hikes as Inflation Risks Rise 
Asian Stocks Fall as AI Fears and Oil Surge Hit Markets 
UK Businesses Urge Government to Cut Electricity Levies 
Gold Prices Steady as Oil Disruptions Boost Fed Rate Hike Bets 
Asian Currencies Subdued as Yen Weakens Ahead of Fed, BOJ Decisions 
BOJ Flags Import Costs and Yen Shocks as Persistent Inflation Risks 
BOJ Set to Raise Rates to 1.25% as Inflation Risks Build 
Oil Prices Surge as Houthi Attacks Raise Saudi Supply Fears 
China Home Prices Fall Again as Property Slump Drags on Growth 
Saudi Oil Exports Face 4% Global Supply Threat as Pipeline Remains Shut 
Japan Producer Inflation Eases to 7.6% in August 
Oil Prices Surge as Houthi Attacks Deepen Hormuz Supply Fears 
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Asian bank stocks fell sharply on Tuesday, with Japanese lenders leading losses after Bank of America warned that weaker trading and investment banking activity could pressure third-quarter revenue.
Sumitomo Mitsui Financial dropped 2.7%, Nomura declined 2.6%, Mizuho Financial lost 2.4%, and Mitsubishi UFJ Financial fell 1.8%. Resona Holdings recorded a steeper 3.5% decline.
The banking selloff spread across Asia. China Merchants Bank fell 2.5%, China Construction Bank dropped 2.3%, Bank of China declined 2%, and HSBC weakened. Singapore lenders OCBC and UOB fell around 2%, while Australian banks National Australia Bank, Commonwealth Bank and ANZ also moved lower.
Asian financial stocks followed Wall Street banks lower after Bank of America CEO Brian Moynihan warned about softer revenue trends. Bank of America shares plunged 5.1% on Monday, while Goldman Sachs and Morgan Stanley also suffered heavy losses. The KBW Bank Index declined about 1.9%.
Moynihan said Bank of America's third-quarter sales and trading revenue was expected to remain roughly unchanged from a year earlier. Investment banking fees could decline at least 10% to between $1.6 billion and $1.8 billion, compared with $2 billion a year ago.
Higher interest rates could further weaken demand for financing, adding another challenge for the banking sector.
Japanese banks faced additional pressure from rapidly rising government bond yields. Japan's 10-year bond yield climbed above 3% as investors increasingly priced in a Bank of Japan rate hike to 1.25% at this week's policy meeting.
Although higher interest rates can improve banks' net interest income over the longer term, a rapid increase in bond yields can reduce the value of bond portfolios and weigh on financing and investment activity.
The broader market also showed signs of sector rotation. While financial stocks struggled following Bank of America's outlook, several U.S. software stocks strengthened as investors reassessed concerns surrounding artificial intelligence disruption. Adobe and Salesforce advanced, while cybersecurity firm CrowdStrike climbed to a record high.
